Correlation Between DAX Index and LVMH Moët
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By analyzing existing cross correlation between DAX Index and LVMH Mot Hennessy, you can compare the effects of market volatilities on DAX Index and LVMH Moët and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in DAX Index with a short position of LVMH Moët. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAX Index and LVMH Moët.
Diversification Opportunities for DAX Index and LVMH Moët
Weak diversification
The 3 months correlation between DAX and LVMH is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding DAX Index and LVMH Mot Hennessy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LVMH Mot Hennessy and DAX Index is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on DAX Index are associated (or correlated) with LVMH Moët. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LVMH Mot Hennessy has no effect on the direction of DAX Index i.e., DAX Index and LVMH Moët go up and down completely randomly.
Pair Corralation between DAX Index and LVMH Moët
Assuming the 90 days trading horizon DAX Index is expected to generate 0.35 times more return on investment than LVMH Moët. However, DAX Index is 2.87 times less risky than LVMH Moët. It trades about 0.05 of its potential returns per unit of risk. LVMH Mot Hennessy is currently generating about 0.01 per unit of risk. If you would invest 1,953,162 in DAX Index on September 26, 2024 and sell it today you would earn a total of 31,715 from holding DAX Index or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAX Index vs. LVMH Mot Hennessy
Performance |
| Timeline |
DAX Index and LVMH Moët Volatility Contrast
Predicted Return Density |
| Returns |
DAX Index
Pair trading matchups for DAX Index
LVMH Mot Hennessy
Pair trading matchups for LVMH Moët
Pair Trading with DAX Index and LVMH Moët
The main advantage of trading using opposite DAX Index and LVMH Moët positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAX Index position performs unexpectedly, LVMH Moët can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in LVMH Moët will offset losses from the drop in LVMH Moët's long position.| DAX Index vs. CODERE ONLINE LUX | DAX Index vs. CARSALESCOM | DAX Index vs. PACIFIC ONLINE | DAX Index vs. Focus Home Interactive |
| LVMH Moët vs. MICRONIC MYDATA | LVMH Moët vs. Hyrican Informationssysteme Aktiengesellschaft | LVMH Moët vs. PKSHA TECHNOLOGY INC | LVMH Moët vs. National Storage Affiliates |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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